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Dollar Higher Ahead of OPEC Meeting

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The dollar was higher against the yen and the euro in Asian trade on Wednesday, as traders took a wait-and-see approach ahead of a closely-watched OPEC meeting later in the day.

Around 0455 GMT, the U.S. currency was at Y112.72, compared with Y111.92 late Monday in New York.

The WSJ Dollar Index, a measure of the U.S. dollar against a basket of major currencies, was up 0.14% at 91.48. The euro was at $1.0632 from $1.0650 late Tuesday.

The greenback quickly gained ground in the mid-afternoon trade to touch as high as Y112.96. The rapid gain, which came without any apparent triggers, suggested flow-driven trade linked to commercial settlement by Japanese corporateplayers was pushing the currency higher. But a lingering wait-and-see mood just hours ahead of the meeting of Organization of the Petroleum Exporting Countries kept a lid on the currency's gains.

"We've seen [orders from Japanese] corporate players constantly today at the end of the month, while many are sitting on the sidelines ahead of the OPEC meeting," said Daiwa Securities senior FX strategist Yukio Ishizuki.

"It's difficult to see a clear direction for the dollar," as long as it stays in its recent range between Y111.50 and Y113.50, said Takuya Kawabata, analyst at Gaitame.Com Research Institute.

For now, investors are keeping close eyes on whether OPEC members can reach a deal to lower output at their Wednesday meeting in Vienna. Comments from officials ahead of the meeting sowed doubts over OPEC's ability to come to an agreement, pulling down oil prices overnight in New York.

Oil and the dollar typically move in opposite directions, because a stronger dollar makes it more expensive for holders of other currencies to buy oil.

But Mr. Kawabata said a potential decline in oil prices will likely pressure down U.S. government bond yields and the U.S. currency. Higher interest rates help support the dollar by making it more attractive to investors seeking for yields.

In other currency trade, the euro was at Y119.83 from Y119.67 overnight.